Are You Careless With Your Tax Affairs?

April 27, 2015

A recent tax Tribunal case has once again highlighted the need to make sure you do more than simply glance at your tax return when approving this for submission to HMRC.

In the case of JA Day & AJ Dalgety vs. HMRC, the Tribunal found the taxpayers to be ‘careless’ in dealing with their tax affairs with the resultant tax consequences this brought in terms of tax due and penalties.

Whilst the case as a whole is interesting (click here to read it), attention is drawn to the two taxpayers’ admissions in relation to their tax returns.

In relation to J Day’s circumstance he was asked “Did you read the return fully?” to which he replied “Can’t say”. The Tribunal then went on to show that had he read the return and accompanying notes fully, he would have identified relevant errors. So in not reading the return fully, the Tribunal found him to be not only ‘careless ’but also negligent in breaching his duty to take reasonable care.

In relation to Miss Dalgety’s circumstances, she was asked with regards to the prepared return, “Did you read it before signing it” to which she responded “I glanced through it” and again the Tribunal went on to show this was both ‘careless’ and negligent. To quote from the Tribunal

“That failure to read the form properly was in our judgment a clear breach of her duty to take reasonable care.”

Aligned to this is ensuring you take reasonable care that the completed return is then filed by the 31st January deadline. Spare a thought for student Jack Dyson who in another recent Tribunal decision has had penalties of £1,300 upheld against him, when both he and his partner in a short term venture only made a profit between them of £1,356!